Competing against Short Sales and Foreclosures
Some areas, such as the one I work in Southwest Florida show no signs of stabilization for now or the near future. The plethora of short sales and foreclosures are beginning to set new market values as they close with lower than market sale prices.
How things have changed! Not too long ago we would throw out the occasional distress sales because they would skew our CMA figures. Now we can't afford to do that, there are so many that they are the market; that is where the few buyers we have are going because they offer the best value for the money.
Distress properties are no longer the run-down, financially and personally abused, hard to sell homes. They are often brand new investor built spec homes, pre-construction purchased condos, and homes where owners took equity while prices were high. They are nice family resales and often they are never lived in properties.
If you are working re-sales in a market that is heavy in pre-foreclosure and foreclosure properties you must consider these sales when setting listing prices. To do otherwise will most likely result in time and money spent on marketing a home that is over priced and won't sell. By ignoring these sales you will also be doing your sellers a disservice. Even though sellers won't like the numbers it is what must be done if the property is to attract buyers and sell.
If you have sellers that must sell because they can't afford to keep their homes or because they are upside down on their mortgage then you might have to get up to speed on how to help them through the short sale process or they may well loose their homes to foreclosure. Remember you are in business to help your customers not simply to get listings.
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